To raise or not to raise: Following intense international pressure to ramp up its climate ambitions, India is considering updating its NDC to include its domestic RE target of installing 450GW by 2030 | Photo: Twitter

India to formalise RE target of 450 GW by 2030 in its NDC before COP26?

Ahead of COP26, there’s pressure on India to enhance its Nationally Determined Contribution (NDC). COP26 President Alok Sharma said he expects India to incorporate a 450 GW renewable energy by 2030 target in the NDC it will submit. India’s informal goal of 450 GW should be formalised before COP26, he said. 

HT reported that PM Modi is likely to be in Glasgow till November 2 when he and UK PM Boris Johnson are expected to make a joint statement on the Green Grids Initiative – One Sun One World One Grid’ (GGIOSOWOG) at COP26. GGIOSOWOG will bring technical, financial and research cooperation to help facilitate cross-border renewable energy transfer projects, according to the International Solar Alliance.

A 14- to 15-member delegation with officials from the ministries of power, finance, earth sciences, agriculture, new and renewable energy, environment, and water will represent India at COP26. It will be headed by environment minister Bhupendra Yadav. 

Govt reduces benchmark costs for off grid solar systems

The Centre reduced the benchmark costs, excluding taxes for decentralised and off-grid solar systems for the financial year (FY) 2021-22. The revised costs include the total cost of the system and its installations, commissioning, transportation, insurance, warranty, monitoring, and maintenance for five years. The new benchmark cost for standalone solar pumps ranges from ₹96,877 (~$1,290) to ₹469,054 (~$6,246) for general category states and around ₹105,509 (~$1,405) to ₹511,202 (~$6,807) for the northeastern region, hill states, islands, and union territories (UTs). Earlier, the benchmark cost for the general category states was around ₹105,500 (~$1,418) to ₹510,800 (~$6,868), and for the northeastern region, hill states, islands, and  UTs, it was ₹114,900 (~$1,544) to ₹556,700 (~$7,485).

For solarisation of grid-connected agricultural pumps, the benchmark cost is around ₹37,649 (~$501.38)/kW to ₹44,352 ($590.65)/kW for various categories. Earlier, it was in the range of ₹41 (~$0.55)/W to ₹48.3 (~$0.64)/W for various categories. The new benchmark cost for standalone solar power projects and battery packs is in the range of ₹50 (~$0.7)/W to ₹86 (~$1.1)/W. Earlier, it ranged from ₹55 (~$0.73)/W to ₹94 (~$1.25)/W for various categories up to the maximum capacity of 25 kW, Mercom reported. 

India’s big RE companies need huge capital to meet targets: IEEFA

For India to reach its renewable energy goals, companies will need to fund capacity expansion with massive amounts of capital at competitive rates, according to the new IEEFA report. This can be done by backing traditional financing sources with other channels such as green bond issuances, asset monetisation and capital recycling initiatives. The report examined RE plans of big firms Adani Green, Tata and NTPC and concluded that the three firms will require major financing drives to meet their RE targets. IEEFA said the NTPC’s thermal power assets are a hindrance for global capital markets. Adani Green, the world’s largest solar firm, has capitalised exceptionally well on its green profile through its high market capitalisation, asset monetisation and bond lending programme. Tata Power has successfully reduced its debt but lacks patient global pension/corporate capital on its books, IEEFA reported. 

Meanwhile, a foreign brokerage company report said India will spend $316 billion (about Rs23 lakh crore) in the decade to 2030 towards de-carbonisation, with investments of over Rs14,051 lakh crore going toward RE projects. 

Solar modules will remain costly till Q1 2022?

Solar module prices are likely to increase further, Chinese modules are expected to stay high until the first quarter (Q1) of 2022. Modules prices have gone up from $0.25/W in the first quarter (Q1) of 2021 to over $0.30/W to date. According to the Asia Europe Clean Energy Advisory, high raw material prices have made polysilicon, EVA, backsheets, aluminum framers, and solar glass also costlier. The prices for solar panels have reached a level not seen in the past 12-18 months. The latest transaction price of polysilicon was approximately 270 renminbi (RMB) (~$42)/kg. Experts said modules account for 55-60% of capital expenditure (CAPEX) of solar projects in India. Therefore, the increase in module prices is expected to increase the overall CAPEX of solar projects by around 18-20%.